There’s a revolution afoot in the grocery industry. If 2020 taught retailers anything, it’s that shoppers crave an omnichannel shopping experience that marries the convenience of digital shopping with the immediate gratification of instore shopping. As such, they are demanding a more personalized shopping experience tailored to their unique shopping behaviors and dietary preferences. When shoppers open their favorite grocer’s app or digital platform, they’re expecting to be shown items that make sense in relation to their shopping and browsing history and current cart selections. They want to browse a web page or app customized to their individual preferences. Even more, shoppers are expecting these apps to predict the products, brands, and deals they’ll be interested in. Consumers demand proactive recommendations uniquely tailored to their behaviors and lifestyle choices. In short, they’re expecting an acutely personalized shopping experience. And if your grocer can’t deliver one, consumers will likely seek it out elsewhere.
Rise of the machine learning
The backbone of this increasingly personalized shopping experience? Machine learning, otherwise known as artificial intelligence or AI. Put simply, AI is technology that utilizes robust data sets in order to think, make decisions, and solve problems like humans. It has gained a foothold in the grocery industry and its presence is only growing as consumers expect more intuitive shopping experiences. According to a study conducted by Juniper Research, global retailers are expected to spend $12B in AI and predictive analytics solutions by 2023, a marked increase from the $3.6B in estimated AI spending in 2019. Overall, Juniper Research predicts that over 325,000 retailers will adopt AI solutions between 2019 and 2023, resulting in a sort of machine learning arms race where early adopters will have a leg up on retailers who implement the technology later. The numbers say it all: AI is driving the future of shopping.
How AI is personalizing the shopping experience
In-depth analytics of the data collected on mobile apps, at the checkout scanner, and beyond provide actionable insights helping grocers understand their customers better. Thanks to the data collected at various touchpoints throughout the shopping journey, grocers can gain a better understanding of who their customers are, their demographic data, their motivations behind each purchase, their behaviors, and even the best channel through which to reach the customer. This empowers retailers to deliver unique offers tailored to each individual consumer. Think of it this way, the last thing a vegan wants to see when opening their favorite grocery store’s app is a deal on hamburger meat or a coupon for flank steak. Conversely, an unrepentant carnivore isn’t going to be interested in push notifications alerting them to a sale on Impossible Burgers.
AI not only advises retailers on what products and deals to show consumers, but whento present those options. The data collected by a grocer’s digital platform provides actionable insights on when consumers like to shop and when they like to browse on retailers’ mobile apps. With advanced algorithms at their disposal, grocers can present the right deal at the right time to the right customer. Therefore, a well-timed alert or coupon can anticipate a shopper’s needs, inspire them to try a new brand, or serve as a helpful reminder to pick up a needed item. That subtle reminder translates to a fuller basket at checkout. Also, consistently and reliably meeting customers where they are and anticipating their needs bolsters customer loyalty.
On a larger scale, understanding who their shoppers are, when they shop, and what they want enables grocers to design more attractive promotions for their loyal customers. Plus, that information allows retailers to make more informed decisions regarding what inventory to stock, minimizing out-of-stock items and food waste.
Looking toward the future
The role of AI in the grocery industry is only getting larger. Grocers are expected to use AI to determine pricing, improve their supply chains, and institute scan-and-go options to eliminate checkout lines entirely. Adopting this technology early and using it strategically is key to maintaining an edge in an increasingly competitive space. Swiftly can help you build or upgrade your app to harness the power of AI and first-party data empowering you to personalize your shoppers’ experiences and engage them at every touchpoint in the shopping journey.
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